Sanjiv Puri's role after elevation will be to continue YC Deveshwar's legacy
Puri, 56, becomes the fifth Indian chairman of the cigarette-FMCG-hotel giant, after Ajit Narain Haskar, J N Sapru, K L Chugh and Deveshwar.
Puri, 56, becomes the fifth Indian chairman of the cigarette-FMCG-hotel giant, after Ajit Narain Haskar, J N Sapru, K L Chugh and Deveshwar. ITC Ltd board on Monday decided Puri’s appointment also as the chairman with effect from today itself.
In a statement issued by the company, Puri said: “It is a responsibility that I accept with humility and with a deep resolve to build on the outstanding legacy nurtured over the years, further strengthen and build market leadership across all business segments whilst reinforcing ITC’s commitment to put nation first always. In the journey ahead, I am sure I can count on the support of our shareholders, partners, associates and most of all, the dedicated team ITC to continue our shared aspiration to build an exemplary enterprise of pride to the nation.”
Puri’s appointment as executive chairman and managing director will also not violate SEBI’s directive which says that chairmen of listed companies shall not be executive directors or related to the managing director and necessary changes need to be done by March 31, 2020.
An industry executive said this SEBI directive is not meant for professional-driven company with no clear promoter like ITC. ”Hence, it is legally not required to split the role of chairman between executive and non-executive. It was split in 2017 so that Deveshwar can step down from day-to-day management and mentor the chosen successors as non-executive chairman,” he said.
Industry executives said since Deveshwar was the non-executive chairman, Puri already was the executive leader and in the thick of action at the conglomerate right from managing day-to-day operations to managing shareholders, government relation and other stakeholders. Puri is also the chairman of ITC’s corporate management committee, the highest executive decision making body in the company, for two years now.
“Deveshwar’s prime responsibility as non-executive chairman was to mentor Puri so he did guide Puri in all big decisions and meetings. In that way, it will be an easy step-in for Puri in the new bigger role,” an executive said.
Puri became ITC CEO in 2017 after Deveshwar stepped down from his executive role and decided to continue as a non-executive chairman. Puri was subsequently re-designated as the managing director last year. Deveshwar had plans to pass-on the chairman post to Puri in 2021-22 when his tenure would end.
An industry executive said two main challenges for Puri will be to insulate the cash spinner cigarette business from recurrent increase in taxation which is shrinking the legal cigarette market in India and to profitably grow the newer FMCG businesses where Deveshwar has already laid down the goal to touch Rs one lakh crore revenue by 2030.
With Puri at the helm, other executive directors in ITC are Nakul Anand (62), who oversees hospitality, travel and tourism and lifestyle retail businesses; B Sumant (55), who looks after cigarettes and FMCG businesses; and Rajiv Tandon (65), the company’s chief financial officer and also in charge of the investment subsidiaries.
There are nine non-executive and independent directors on the board – one representative each from three large shareholders British American Tobacco, Life Insurance Corp. of India and General Insurers' Association of India; three ex-bureaucrats including two women directors; one retired, senior professional of ITC itself; an ex-banker and LIC’s ex-chairman, who is also ex-administrator of the Specified Undertaking of the Unit Trust of India.
An alumnus of IIT Kanpur and Wharton School of Business, Puri has been a lifer with ITC much like Deveshwar. He joined the company in 1986 and rose through the ranks like his predecessor.
Between 2001 and 2006, he was MD of Surya Nepal, ITC’s joint venture subsidiary in the neighbouring country. He then led the IT business subsidiary, ITC Infotech India Ltd, as its MD till 2009 when he was appointed the divisional chief executive of the cigarette business with additional responsibility for the entire cigarette and FMCG (fastmoving consumer goods) distribution and the trade marketing vertical.
Puri’s rise has been rapid in the past five years. In 2014, he was made president of the FMCG businesses, a new position that was created to take overall charge of the entire segment comprising cigarettes, packaged food, personal care, education and stationery products, safety matches and agarbattis.
In 2015, Puri became an executive director when he was made overall in charge of FMCG, paperboards, paper and packaging and agri-businesses. In 2016, he was appointed to a new role of chief operating officer. In 2017, Puri was made the CEO, taking independent charge of executive leadership at ITC and was subsequently re-designated as the managing director.